Numbers Not Adding Up for City's Small and Minority Business Department

The city's Small and Minority Business Resources Department is operating with bad information, at a loss to certify how many businesses in its files are truly minority-owned, women-owned, or disadvantaged businesses, according to a report by the Office of the City Auditor. "In our audit we found problems in the area of certification, specifically as it relates to the accuracy of data on certified firms maintained by the certification agency that processes certification of Minority-Owned Business Enterprise (MBE) and Women-Owned Business Enterprise (WBE) for the City of Austin," says the report, released at yesterday's meeting of the Audit and Finance Committee. "We also found that SMBR’s oversight of the contract with the certification agency was weak."

In 2004, the agency outsourced its MBE, WBE, and DBE certification to South Central Texas Regional Certification Agency for $50,000 a year. It's there the auditor's office found problems with the "accuracy of data on certified firms maintained by the certification agency that processes certification of MBE and WBE for the City of Austin," and that "SMBR’s oversight of the contract with the certification agency was weak."

Most shockingly, the information in the city's own database is wildly out-of-sync with its contractor. "As of October 2006, the SCTRCA database showed 761 firms certified as MBE, WBE, or DBE for the City of Austin, and the City vendor database showed 1,401 firms as being certified. … SMBR’s monitoring of the contract with SCTRCA does not provide sufficient assurance that the desired goals of the certification activity are achieved and that accurate information is provided to the City."

Download the report here.